Inside Trump’s War on Regulations

Inside Trump’s war on regulations

WASHINGTON, DC – MARCH 13: President Donald Trump shows an executive order entitled, ‘Comprehensive Plan for Reorganizing the Executive Branch’, after signing it beside members of his cabinet in the Oval Office of the White House on March 13, 2017 in Washington, DC. (Photo by Michael Reynolds-Pool/Getty Images)

The chaos of Donald Trump’s first four months as president has overshadowed a series of actions that could reshape American life for decades — efforts to rewrite or wipe out regulations affecting everything from student loans and restaurant menus to internet privacy, workplace injuries and climate change.

Trump and his agencies have already wielded executive actions and Republican control of Congress to postpone, weaken or outright kill dozens of regulations created by Barack Obama’s administration, often using delays in the courtroom to buy time to make those changes. Their targets have included protections for streams from coal-mining pollution and a directive on the rights of transgender students.

Rolling back the regs

The administration’s efforts to unwind regulations span the U.S. economy. The president’s aides say the goal is “systemic” change.

But Trump is going after even bigger targets, setting bureaucratic wheels in motion that could eventually ax or revise hundreds of regulations as agencies reorient themselves toward unwinding red tape and granting speedier approvals to projects. Just one of those efforts — an upcoming plan by Commerce Secretary Wilbur Ross forreducing burdens on manufacturers — yielded 171 suggestions from business groups and others who submitted comments. Another executive order, requiring agencies to repeal two regulations for every new one they create, “will be the biggest such act that our country has ever seen,” Trump said in January.

If successful, these efforts could represent the most far-reaching rollback of federal regulations since Ronald Reagan’s presidency, especially if Trump’s proposed budget cuts make it hard for a future Democratic president to reaccelerate the rule-making apparatus. But Trump’s retrenchment faces multiple obstacles, including his slow pace in naming political appointees and his team’s overall inexperience in navigating the federal bureaucracy.

The goal of the effort is “systemic reform,” said Andrew Bremberg, director of the White House’s Domestic Policy Council — aiming for results that last well beyond Trump’s presidency.

In one sign of their ambition, administration officials say legislation to carry out Trump’s infrastructure plan will seek to overhaul the federal permitting process, including by proposing to rewrite the landmark1969 law that undergirds agencies’ reviews of projects’ environmental impacts.

“I think it’s something that’s just been lost on people in terms of the regulatory sediment that has built up — decade after decade after decade in many of these areas,” Bremberg said in a telephone interview. “You’re talking about legislation that was either passed at the beginning of the last century or somewhere in the middle of the last century, amended a couple times here and there, but whose statutory structure has largely stayed the same. Yet the regulatory structure has just layered — layer after layer after layer on a seemingly constant basis.”

Some progressives are unnerved by what Trump’s deregulation campaign has achieved already.

“He’s done tremendous damage,” said Rena Steinzor, a University of Maryland law professor who has tracked regulations for decades. “I’ve been watching through six presidents, and all that pales in comparison to this.”

Trump’s team has more executive orders and memorandums meant to further accelerate the deregulatory effort that have yet to be released, according to two people familiar with the administration’s planning.

Much of Trump’s rollback is an aggressive repudiation of one of Obama’s proudest legacies, his crusade to enlist the U.S. in the fight against climate change.

Trump signed off on congressional actions that used a seldom-invoked 1996 law to block four energy-related rules, including an anti-corruption regulation that required oil and gas companies to disclose their payments to foreign governments. He has also ordered the EPA to review — and most likely rescind — two sweeping Obama-era rules, one restricting power plants’ greenhouse gas pollution and one spelling out Clean Water Act protections for wetlands and waterways.

The administration has left the fate of several regulations in limbo by persuading federal judges to postpone action on legal challenges filed by industry groups and GOP-led states. Such delays have affected EPA’s power plant climate rules, along with regulations on toxic mercury pollution and smog-causing ozone. Administration lawyers have similarly sought to delay court action on rules regarding overtime pay, anti-union “persuaders” and Obamacare’s birth control mandate.

The fight is getting personal attention from Trump, whose desire to streamline regulations and speed up permits originated with his decades-long career as a real estate developer, according to people who have spoken to the president and his top advisers. Which regulations the administration should eliminate often comes up in Trump’s White House meetings with CEOs, according to three people briefed on the meetings.

Executives who meet with the administration often name regulatory reform as their top agenda item, even ahead of tax reform, according to officials have held discussions with hundreds of business leaders.

But the administration doesn’t automatically take every industry suggestion, said Chris Liddell, the White House’s director of strategic initiatives. “We’re not just taking away regulations for the sake of it,” he said, adding: “This is not about making companies more profitable. It’s about facilitating job creation.”

Bremberg said the administration recognizes that “we’re not the private sector industry. We are the government. We set the rules and we enforce the rules.”

“But we also have to recognize that the private sector is largely made up of entities that want to follow the rules,” Bremberg said. “They just experience a lot of frustration about the rules not being clear or the regulatory agencies taking a gotcha approach.”

Not every Obama administration rule is falling prey immediately to the anti-regulation campaign. The Labor Department’s much-contested “fiduciary rule,” which requires financial advisers to consider only their clients’ best interest when providing retirement advice, will be allowed to take effect June 9 after initially being delayed 60 days, Secretary Alexander Acosta said last week. (Acosta said he could find “no principled legal basis” for delaying it further, but left the door open to changing the rule later.) The Energy Department has also given final approval to an efficiency regulation for ceiling fans after two delays.

Trump’s efforts go well beyond reining in individual rules. He has issued broad directives meant to speed up environmental reviews for“high priority” infrastructure projects, ordered a wide-ranging review of tax regulations and created a task force to examine laws and rules that affect rural America, in addition to Ross’ review of impediments to domestic manufacturing.

The president has also directed Treasury Secretary Steven Mnuchin to conduct a comprehensive examination of financial regulations, with the first report expected to come in early June.

White House officials say these actions are the first step in a broader rethinking of how the government regulates. Strategy discussions on that effort include regular meetings with Bremberg, Office of Management and Budget Director Mick Mulvaney, senior adviser and presidential son-in-law Jared Kushner, White House counsel Don McGahn and Reed Cordish, who is helping to organize a new office tasked with downsizing the federal bureaucracy.

The administration also hopes to advance its deregulatory agenda through legislation to promote its infrastructure plan, which White House officials said will include an overhaul of the federal permitting process. That will include a push to revise the National Environmental Policy Act, a 1969 law that Republicans say slows projects’ approvals with overly burdensome environmental assessments.

“We will be fixing what is a broken permit process,” Cordish said in an interview, adding, “It’s literally hundreds of individual changes that we need to make legislatively and administratively to the current process.”

Trump’s advisers also hope to use data to find efficiencies in the permitting and regulatory process, an issue that Kushner and his Office of American Innovation have made a top priority.

Then again, most administrations come into office with grand ideas about making the government more efficient. But the federal bureaucracy is a slow-moving machine, and sweeping changes usually face skepticism in Congress.

Compounding those obstacles are Trump’s slowness to fill the ranks of the political appointees who would carry out his agenda — perhaps over the resistance of career employees — and the lack of government experience among the president and his top aides. Trump may see newness to Washington as a positive trait, but it could also keep him from accomplishing his goals.

“The administration might have some visions of what they want the agencies to be doing — not just about reversing course from the Obama years but advancing the jobs agenda or ‘America First,’” said Philip Wallach, a senior fellow at the Brookings Institution and expert on the administrative state. “Those moves require skillful coordination of the bureaucracy rather than a deconstruction of it.”

“If you don’t have political leadership in the agencies, then you’ve handed the keys to the bureaucrats,” said Jay Lefkowitz, who was OMB’s general counsel under President George W. Bush.

Even one White House official acknowledged that the administration’s unfamiliarity with government is getting in the way of restructuring it.

“In order to reshape it, you need to have an understanding of how it works,” said the official, who requested anonymity to speak freely. “I have not seen a lot of it among the folks I have worked with so far. It is an issue of folks not being able to get out of their own way.”

Officials in some agencies have been confused about how to implement Trump’s executive orders, such as the two-for-one mandate that includes strict limits on the costs of new regulations. (Groups including Public Citizen and the Natural Resources Defense Council have sued to block that order, saying it would force agencies to cancel regulations arbitrarily.)

The administration has also lagged in setting up regulatory reform task forces within agencies, as required by a separate order.

One career government official argued that Trump’s political appointees don’t understand the complexities of undoing regulations, which requires additional cost-benefit analysis, public comment periods and a lengthy process to rewrite rules — not to mention inevitable legal challenges.

Still, administration officials cite a series of early victories, including lawmakers’ use of the 1996 Congressional Review Act — never before invoked so aggressively — to overturn a flurry of late-Obama-era regulations. Trump signed 14 CRA resolutions, killing regulations that protected Planned Parenthood’s state funding, restricted gun sales to the mentally ill and safeguarded the privacy of broadband customers, among others.

But the deadline for using that law to thwart Obama’s rules has passed, so the administration will have to focus on other ways to deregulate.

Administration officials also note that Trump-appointed Supreme Court Justice Neil Gorsuch has shown some skepticism toward federal regulations, a position that could help them if legal challenges reach the high court. Trump has also chosen Neomi Rao, a former George W. Bush appointee well-liked in conservative circles, to head the White House’s Office of Information and Regulatory Affairs, the gatekeeper for new regulations.

Some Democrats are still deeply skeptical of the Trump administration’s boasts about reshaping the government.

“The vast majority of what he’s done so far is purely symbolic,” said Shaun Donovan, who was Obama’s OMB director from 2014 to 2017.

“Sound bites are one thing, but changing government really requires rolling up your sleeves and doing the work,” Donovan said in a recent interview. “And I haven’t seen any sleeves rolled up.”

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